In a significant move aimed at alleviating the economic strain on citizens, the government has officially gazetted the suspension of Value Added Tax (VAT) on essential food items, effective from February 1, 2024. The Statutory Instrument 10A of 2024 outlines the VAT exemption for crucial grocery items, including bread, milk, cooking oil, and maize meal.

The decision to implement this exemption follows careful consideration of concerns raised by business leaders, who argued that the initially proposed VAT measures in the 2024 National Budget could potentially lead to an increase in prices for essential goods.

Finance, Economic Development and Investment Promotion Minister, Mthuli Ncube, addressed these concerns through the publication of Statutory Instrument 10A of 2024 in a supplementary Government Gazette released on Wednesday. The new regulation amends the Customs and Excise (Suspension) Regulation 2003, which was previously published in Statutory Instrument 257 of 2003. Minister Ncube highlighted the changes in the following statement:

“It is hereby notified that the Minister of Finance, Economic Development and Investment Promotion, in terms of Section 235 as read with Section 120 of the Customs and Excise Act (Chapter 23:02) has made the following regulations. The regulations may be cited as the Customs and Exchange (Suspension)(Amendment) Regulations, 2024 (No. 272). The Customs and Excise (Suspension) Regulation 2003 published in Statutory Instrument 257 of 2003 (hereafter called the principal regulations) are amended by the repeal of Section 91 (Suspension of duty on cooking oil, maize, milk, sugar, rice, flour, salt, bath soap, laundry soap, washing soap, baking powder, toothpaste and petroleum Jelly) with effect from 1st February 2024.”

The specific items covered under the exemption reflect a comprehensive understanding of the basic necessities for households. By lifting the VAT on these essential food products, the government aims to ease the financial burden on citizens, ensuring that access to fundamental groceries remains affordable for all.

This initiative aligns with the government’s commitment to supporting its citizens during challenging economic times, promoting social well-being, and fostering a stable environment for all members of the community. As the VAT suspension takes effect, consumers can anticipate a positive impact on their household budgets, allowing for greater financial flexibility.

In conclusion, the government’s decision to exempt VAT on key basic grocery items demonstrates a proactive approach to address the concerns of both business leaders and the general public. This move underscores the importance of prioritizing the affordability and accessibility of essential goods, ultimately contributing to the well-being of Zimbabwean households.